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Is Boeing Co capable of making commercial aircraft at all?
It’s worth asking after an excoriating report by a US congressional committee on the circumstances leading up to the fatal crashes of two 737 MAX planes. The accidents were “the horrific culmination of a series of faulty technical assumptions by Boeing’s engineers, a lack of transparency on the part of
Boeing’s management and grossly insufficient oversight†by regulators, according to the report. Pending legislation may tighten that oversight, adding to future costs.
The plane hasn’t flown in more than 18 months. Though European safety officials have finally completed testing that could help return it to service and the US National Transportation Safety Board signed off on proposed fixes that include pilot procedures, American Airlines Group is already seeking to defer planned deliveries.
For all that, the plane may actually be the bright spot in Boeing’s airliners business. More than a decade after first taking to the skies, the 787 Dreamliner is still struggling to make back the vast costs that went into its development. That challenge has been complicated by the impact of coronavirus, which has dealt a particularly hard blow to
the long-haul, cross-border travel in which twin-aisle jets like the 787 specialise.
A smaller slate of expected orders and slowing pace of deliveries has left the 787 program close to break-even levels and may result in a loss in the long term, the company said in second-quarter results last month. The more fuel-efficient variant of the 777, the 777X, only started test flights earlier this year but is facing similar problems. A range of potential issues from the coronavirus to supply chain and aircraft certification wrinkles could push it into the red in the future, Boeing warned.
The 737 MAX has more than its share of woes —
but thanks to the vast numbers on order and the
same skimpy development budget that led to its poor safety record, that sort of financial insolvency isn’t yet one of them.
Even now, there’s no warning from Boeing of potential losses on the program as a whole, and analysts tend to agree that it should make money as airlines do their best to stop shorter-range jets turning into an Airbus SE A320 monopoly.
—Bloomberg